Significant Cost Reduction in MPLS Implementation Case Study
Source One Management Services, LLC was engaged by one of the nation’s largest healthcare providers to assist in the strategic sourcing of its telecommunications spend.
Included in this spend were two distinct constructs for data (Wide Area Network) and internet connectivity for different sets of locations:
- Virtual Private Network (VPN), using the public internet, and
- Frame Relay Network with low bandwidth ports and internet connectivity through the Frame Relay ports
In addition, from a management point of view, there were many challenges in maintaining site by site firewall and web-filtering capability. Our customer identified several pressing needs:
- Dramatic increase in bandwidth
- Centralized control of firewall and web-filtering
- Ability to converse from site to site (as opposed to a hub and spoke model)
- Addition of Class of Service to prioritize traffic across the network
- And, SIGNIFICANT COST REDUCTION
Source One helped design and negotiate a single provider network on an MPLS (Multiprotocol Label Switching) platform.
Bandwidth availability increased significantly (Three to fourfold), centralized control of firewall and web-filtering was established, and sites were able to communicate directly with one another.
Each site was also allowed to prioritize traffic through its own local access and across the network with the addition of QoS (Quality of Service).
Significant cost reduction was achieved in the selection of a new supplier. The network contract demonstrated a 50% savings compared to the original offer provided by the incumbent frame relay provider.
By consolidating networks and implementing the new wide area network structure, our customer’s actual net costs decreased by a quarter of a million dollars per year while provided much greater serviceability to its locations.
This sourcing initiative was approached with a collaborative mindset and, by combining the collective resources and category expertise of Source One and its customer, the team was able to obtain best-in-class total value for this telecommunications procurement project.
The net result was a network that provided an easily managed resource with dramatic increase in bandwidth and functionality, prepared for future growth, and significant cost reduction.